Sega Sammy income rises 52 percent

Pachinko slot machine Hokuto No Ken SE success hailed; caution urged on profit figures.

Sega Sammy has released its consolidated financial statements for the six months ending September 30. The company exceeded expectations and reported sales of 283.5 billion yen ($2.4 billion), up 14.1 percent from the same period last year, and a rise in net income to almost 38 billion yen ($322 million), up 52.3 percent. The company attributed the better-than-predicted financial results to the "main old-regulation" pachinko slot title Hokuto No Ken SE, which sold close to 320,000 units. Another factor cited was strong sales of long-selling amusement machine products.

Despite the positive numbers, Sega Sammy remained cautious and downsized figures for the full fiscal year's predicted sales and income. It slashed its sales forecast for pachinko machines from 570,000 units to 301,000. This is due to Japan's July 2004 revision of regulations for gaming machines, the company stated, and that the new regulation-compliant machines will be expected to take a while to gain popularity. The number of pachinko parlors and players in Japan has been in decline, making the company cautious about predicted earnings in the future.

Sega Sammy holdings also revised its forecasted operating results for the fiscal year 2006 and reduced its expected net sales by 102 billion yen ($867 million) to 580 billion yen ($4.9 billion) and net income by 15 billion yen ($130 million) to 60 billion yen ($635 million). Full-year net profits were expected to be down 60 billion yen ($507 million).

Software sales were considerably up, with sales of 5.8 million units compared to 1.3 million copies in the previous six months. The company is predicting game revenue for the fiscal year ending March 2007 of at least 6.7 million copies in Japan, 6.3 million in the US, and 8.9 million in Europe. In its amusement center business, Virtua Fighter 5 was billed as strong selling, although the children's card game machines Oshare Majo Love and Berry and Mushiking: The King of Beetles were reported as being slightly down year on year.

The emergence of next-generation game consoles is a "prime opportunity" to capture a greater share of the home video game market, according to the report. The company also stated its intention to "establish local product development bases in overseas markets" through "aggressive" mergers and acquisitions with development studios.

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Discussion

37 comments
EmperorSamoth
EmperorSamoth

Way to go Sammy. Thanks for bailing out Sega out of their misery. I love Sega and this is nothing short of good news.

GrimBee
GrimBee

Sega have some absolutely awesome franchises and liscences out there, with their teaming with sammy... this means... Metal Slug is also on their list too! Well, for Sega's next move, instead of cranking out NEW games characters and Lisences, i think Sega should do this - 1) Get back the old "seeeeeeeeeeggaaaaaaaaaaaaa" logo and intro voice back! 2) Get some incredible remakes (or new versions) of their old lisences, kinda like what they did with afterburner and outrun 2.. but better. I mean, Altered Beast remake was terrible.. so nothing like this.. But a next gen streets of rage (with massively interactive enviroments and an awesome fighting combat system (no godhand type of stuff here!) classic streets of rage gameplay (chuck blokes into stuff etc). Also.. they should re-invent Decap Attack (remember that?!).. but to a quality title like Jak and Daxter.. NOT the likes of toejam and earl III PLEASE! And what about Greendog? Heck, why not even go out there and make a fantastic epic Golden Axe game! Sega already has wonderful lisences, if they can make incredible games out of them then they will surely reap in the rewards. And then when those game become popular, they can make MORE money on their retro counterparts on the virtual console! Sega are in such a good position right now. Alot of games studios don't have the great franchises like sega do.. there are just SO many! I mean, literally all sega would need to do is release a complete arcade conversion of all its greatest titles for the wii (perfectly converted of course) and they wouldnt even need to make perihperals! I mean, virtua cop, DAYTONA USA!, Sega Rally... with online play etc... wow, Id love that! Come on Sega!

Neoyamaneko
Neoyamaneko

Congratulations SegaSammy on influencing pachinko addicted mothers to leave their children to suffocate in the car while they play on the Fist of the Northstar machine.

XAF1
XAF1

They need to get rid of the Virtua Fighter 5 PS3 exclusive concept and bring the game to both consoles since they can both handle it. As far as Sonic goes I won't hold my breath on it not having deadly camera problem especially after playing the demo on the Xbox 360. The same camera problem with every other 3D Sonic before this new one still exists and should have been solved by now. I'm happy to see Sega making a come back in the financial arena but it still has a ways to go in learning about what consumers want or at least American consumers. A great deal of the teams that made their original franchises have either moved on and are no longer with Sega or have been reassigned within SegaSammy---- so system biasness has stepped in. As far as Shenmue 3 goes I will be amazed if it surfaces during the Xbox 360/PS3/Wii generation due to some of the complications Sega is having with deciding on its development. As I said I am happy that Sega has started showing a nice profit but they also have to keep it up and that often proves to be harder. Each decision Sega makes determines where it lands in the financial gamble. Starting new franchises is great but the new and old must be balanced across platforms unlike with the Gamecube/PS2/Xbox generation.

fierro316
fierro316

I hope they decide to remake or port games that only few enjoyed like Panzer Dragoon Saga, Shining Force series, Dragon Force, Shenmue I & II, etc. Becoming a third party was a great move.

JoseVenda
JoseVenda

I'm happy that a lot of you guys are showing so much love for SEGA :) SEGA doesn't need to make another console, they must continue the way they thrilled... and revive some of their old franchises...

altoids
altoids

Think you all missed the part where they said full-year net profits were expected to be down 60 billion yen ($507 million).

oliver_475
oliver_475

sega made house of the dead! So this is he best news ever!

budlongmv
budlongmv

I love it that Sega is making lots of money now, vs before Dreamcast when they were losing money like crazy. I just hope they use this money and make awsome next gen versions of their great franchises like, Shenmue, Panzer Dragoon, Jet Set Radio, Skies of Arcadia, etc... and some new and incredible franchises. There is no reason why Sega shouldn't be bigger than EA, Ubisoft, or any other 3rd party with the talent and history that they have. GO SEGA!!!!

Sonic43090
Sonic43090

If Sonic Next-Gen is a hit, then they'll need to convert an Olympic size pool to a vault! SE-GA!..Oh, and go that other company you merged with to. Yeah...

emorule
emorule

They need to make a portable dreamcast that would be so good!

SinfulSpikey
SinfulSpikey

Yes! This has actually been the first bit of (non-Sony trashing) news I've smiled at in a LONG time. Hell yes, go SEGA! :D Now let's hope and pray they'll devote some of this cash to a *grins* DreamCast 2. >:D

GrimBee
GrimBee

Shenmue 3 indeed Schillinger! I would love Sega for them to bring the Shenmue Series to the Wii. I think it would appeal and sell far better on the Wii than any other console. My reasons being - Shenmue 1 (fully playable) with FREE internet for the Shenmue Passport thing (and you could download stuff!) also the connect 24 service could actually do stuff REAL TIME to the game. Shenmue 2 would be awesome, also... Shenmue 3 would be perfect, mainly because the Shenmue games are VERY interactive, it would be really awesome to interact with things with the wii remote. And also, having a classic controller setup is essential aswell. Please Sega, release Shenmue 1 2 AND 3 for the Wii!! You would get access to more users, the free online service also sets up what you planned to do with the Dreamcast! Simply fantastic stuff :D

ultimate_zero
ultimate_zero

I expect alot of good games from Sega, they already have a sonic game and i wonder how it will do.

Schillinger
Schillinger

Come back Sega, we need Shenmue 3 and Rez 2!! :cry:

manapsal
manapsal

i hope they make another guilty gear game...next-gen 2D!!! lol

DS_fan_atic
DS_fan_atic

Thats good I guess, now that they have some money they can make good games again

ZabuzaR
ZabuzaR

Wow that is cool. I just hope they will get some good games this gen.

amurphy245
amurphy245

good news i hope they continue this success and start making quality games again.

Legir
Legir

I hope they do well.

Gamer_babe
Gamer_babe

The balls are a little smaller in Pachinko...and instead of at a slant like pinball, I believe the games are straight up and down...or at way more of an angle. I could be wrong though.

gmsnpr
gmsnpr

I'm glad that they're solidly in the black. Now if they can work on getting more good games for the home market in this gen, that'll be great.

diablobasher
diablobasher

Pachinko is something akin to pinball isnt it? I first thought of the little plastic kinder egg type figureines, but that's Gashapon. Hooray for Sega ^_^

Vojkan80001
Vojkan80001

Sega will never again release new console. There is just no need to do it. The only thing they would achive is to loose "again" more money. Since they quit with console and became software company they are just making more and more money. Even if they "released" new console it would probably fail since its imposible to gain any market share next 2 Sony, Microsoft and Nintendo.

kyosukeugc
kyosukeugc

You know, I'd almost laugh if Sega created a new console.... I'm not really familiar with this, but sounds interesting for them atleast.

Dolacide
Dolacide

Sega is finally turning it around.

The_General2000
The_General2000

Hate to sound ignorant, but what IS "pachinko"? Whatever it is, it's becoming less popular? What?

icym
icym

Which means great news for us during this new incarnation of next gen consoles. More games and resurrections of of old titles! Its a great time to play games!